Portugal Still Attracting Buyers for Better or Worse
10 August 2011
Portugal is still a popular choice for UK buyers looking for a second home or to retire abroad, and many are taking advantage of falling house prices due to the continuing Eurozone debt crisis to snap up a bargain.
The Algarve is particularly popular especially the resort of Villamoura, which recently benefited from a £1.2 million investment into its beaches, paths and port, and property experts think this is a particularly good region for investment. The fall in property prices has made Villamoura increasingly accessible to anyone looking to buy property in this region, and its reputation as a holiday hotspot is growing.
There are worries that the country could be headed for further trouble since requesting a bailout from the European Union as it has already put in place a series of austerity measures which could go on for years, and which are likely to lead to higher unemployment and a fall in consumer spending. However at the moment the banks are reporting relative stability, with most buyers able to still service their loans. The president of Banco Espirito Santo SA, Ricardo Salgardo is reported as saying that the property market is stable and that it isn't suffering from a property bubble which has been experienced in Ireland and Spain.
Some analysts do think that things are changing, and that property prices may have a little further to fall especially as interest rates are rising and some homeowners could find it more difficult to pay their mortgages. The Bank of Portugal has already said it expects the demand for mortgages to fall during the coming months.
In spite of this Portugal is probably still a reasonable bet for anyone prepared to invest for the medium to long-term, and it's certainly good news for anyone who wishes to retire here and who has no intention of selling up in the foreseeable future. Portugal will always be a popular holiday destination, and buy to let investors can still be pretty confident about good rental returns.